COURT OF APPEALS OF VIRGINIA

Present: Judges Elder, Frank and Humphreys

Argued at Salem, Virginia

JENNIFER G. FRANCIS

OPINION BY

v. Record No. 0827-11-3 JUDGE ROBERT J. HUMPHREYS

NOVEMBER 29, 2011

VIRGINIA EMPLOYMENT COMMISSION AND

 WAL MART ASSOCIATES, INC.

FROM THE CIRCUIT COURT OF CAMPBELL COUNTY

John T. Cook, Judge

Greg Hairston (Caroline Klosko; Virginia Legal Aid Society, Inc., on 

brief), for appellant.

Elizabeth B. Peay, Assistant Attorney General (Kenneth T. 

Cuccinelli, II, Attorney General, on brief), for appellee Virginia 

Employment Commission.

No brief or argument for appellee Wal Mart Associates, Inc.

Jennifer G. Francis (“Francis”) appeals a ruling from the Circuit Court for Campbell

County (“circuit court”), dated March 25, 2011, affirming a decision from the Virginia 

Employment Commission (“VEC”), entered May 6, 2009, that disqualified Francis from 

receiving unemployment compensation benefits under the Unemployment Benefits Act (“the 

Act”). Specifically, Francis alleges the circuit court erred in affirming the VEC’s ruling that 

Francis was terminated from her employment at Wal-Mart for “misconduct connected with” her 

work. For the following reasons, we affirm the decision of the VEC.

I. Background

The facts are not in dispute. Francis was employed from June 8, 2006 to April 22, 2008, 

as a merchandising supervisor in the health and beauty department at Wal-Mart, earning $8.35 
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per hour. Francis’s job duties included making price changes on merchandise and stocking 

shelves. Francis also supervised two associates, and, on occasion, she was required to operate 

the cash register. Francis did not have any problems at Wal-Mart prior to April 22, 2008, and 

had never been disciplined at work.

On April 22, 2008, Francis informed Wal-Mart that she was going to be charged with two 

felony counts of welfare fraud. Wal-Mart suspended Francis’s employment pending the 

outcome of the case and informed Francis that if she was found guilty of the charges, her 

employment with Wal-Mart would be terminated. Wal-Mart also gave Francis the option of 

resigning her employment so it would be easier to get another job. On May 26, 2008, Francis 

notified Wal-Mart that she had decided to plead guilty to the charges and, as a result, Francis 

submitted her resignation in lieu of termination. Francis ultimately received a suspended 

sentence and probation as a result of her convictions.

Francis filed a claim for unemployment benefits with the VEC on May 27, 2008. A 

claims deputy denied her claim on June 18, 2008, and Francis appealed. The appeals examiner 

conducted a telephonic hearing on September 18, 2008. At the hearing, Francis’s immediate 

supervisor, Jennifer Campbell, confirmed that Francis would have been terminated had she not 

resigned, and explained that Francis violated Wal-Mart’s code of ethics when she committed 

welfare fraud. Campbell stated that “fraud in itself is related to retail, because retail deals with 

dollars, it deals with paperwork dollars, it deals with physical dollars and merchandise.” 

Campbell also admitted, however, that she would never have known about the charges against 

Francis had Francis not told her about them herself.

Lisa Radcliff, a store manager at Wal-Mart, admitted she had not received any 

complaints over Francis’s job performance, but she confirmed that Francis’s act of committing 

welfare fraud violated Wal-Mart’s code of ethics. Radcliff specifically referenced a “financial 
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integrity” clause from Wal-Mart’s code of ethics that requires “honest and accurate recording 

and reporting of financial information . . . in order for that Associate to make responsible 

decisions.” Wal-Mart did not provide a copy of the entire policy for review.

Upon the conclusion of all the testimony, Francis argued to the appeals examiner that the 

financial integrity clause in Wal-Mart’s code of ethics is “talking about reporting information at 

Wal-Mart” and speculated “if she would have falsely reported something . . . her financial 

information at Wal-Mart . . . then that’s what it would have applied [to].” Francis argued that the 

policy “has nothing to do with what she did, welfare fraud. It had nothing to do with her job at 

Wal-Mart.” Francis stressed that her supervisors would, in fact, never have known about the 

charges had she not told them herself and concluded that her misdeeds were “not connected with 

work.” 

The appeals examiner disagreed with Francis and denied benefits. Francis then appealed 

to a special examiner. By order entered May 6, 2009, the special examiner affirmed the appeals 

examiner and disqualified Francis from receipt of unemployment benefits. The special examiner

concluded, 

[Wal-Mart] has presented sufficient evidence to establish a 

reasonable nexus between [Francis’s] job duties and 

responsibilities and the misconduct. [Francis] pled guilty to and 

was convicted of felony welfare fraud, a crime of moral turpitude. 

The evidence also established that [Francis’s] job duties and 

responsibilities required her to, among other things, operate the 

cash register for the employer, which placed her in a fiduciary 

capacity, and a position of trust with the employer.

Francis appealed the matter to the circuit court.

The circuit court held a hearing on March 25, 2011, and “after considering the authorities 

and arguments of counsel,” affirmed the VEC’s decision. 

Francis timely noted her appeal to this Court.
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II. Analysis

The sole question on appeal is whether the circuit court erred in affirming the VEC’s 

finding that Francis was terminated from her employment for misconduct “connected with 

work.”1

In cases that originated in the VEC, we, “[l]ike the circuit court,” must “‘consider the 

evidence in the light most favorable to the finding by the Commission.’” Williamson v. Va. 

Empl. Comm’n & Mills Heating & Air Conditioning, Inc., 56 Va. App. 14, 17, 690 S.E.2d 304, 

305 (2010) (quoting Wells Fargo Alarm Servs. v. Va. Empl. Comm’n, 24 Va. App. 377, 383, 

482 S.E.2d 841, 844 (1997)). “‘If the commission’s findings [of fact] are supported by the 

evidence, they are binding on appeal.’” Id. (quoting McNamara v. Va. Empl. Comm’n, 54 

Va. App. 616, 624, 681 S.E.2d 67, 70 (2009)). In other words, where the Commission’s findings 

of fact are supported by the evidence, “they are conclusive on appeal and our jurisdiction is 

limited to questions of law.” Kennedy’s Piggly Wiggly Stores, Inc. v. Cooper, 14 Va. App. 701, 

704, 419 S.E.2d 278, 280 (1992) (citing Israel v. Virginia Employment Comm’n, 7 Va. App. 

169, 172, 372 S.E.2d 207, 209 (1988)). In cases where the facts are not in dispute, the only 

question this Court must decide is whether the Commission’s findings of fact “are sufficient, as a 

matter of law, to constitute misconduct.” Id. at 704, 419 S.E.2d at 280.

Under the Act, “‘[t]he legislature intended unemployment benefits to be paid only to 

those who find themselves unemployed without fault on their part.’” Va. Empl. Comm’n v. 

Cmty. Alternatives, Inc., 57 Va. App. 700, 704, 705 S.E.2d 530, 532-33 (2011) (quoting Va. 

Emp’t Comm’n v. Trent, 55 Va. App. 560, 568, 687 S.E.2d 99, 103 (2010)). Nevertheless, since 

 1 According to the VEC, “[i]n cases where an employee is given the option of resigning 

or being discharged, and chooses to resign, the commission has consistently held that the 

separation from employment is involuntary and the merits of the case should be considered under 

[Code] § 60.2-618(2).” VEC does not dispute the fact that Francis’s separation from 

employment was involuntary.
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the Act is remedial in its purpose, id. at 708, 419 S.E.2d at 282 (citing Israel, 7 Va. App. at 172, 

372 S.E.2d at 209), “[e]ven employees who are fired for what the employer considers good cause 

may be entitled to unemployment compensation,” Blake v. Hercules, Inc., 4 Va. App. 270, 273, 

356 S.E.2d 453, 455 (1987). Thus, “‘the statutory term “misconduct” should . . . be construed in 

a manner least favorable to working a forfeiture so as to minimize the penal character of the 

provision by excluding cases not clearly intended to be within the exception.’” Piggly Wiggly, 

14 Va. App. at 707-08, 419 S.E.2d at 282 (quoting 76 Am. Jur. 2d, Unemployment 

Compensation § 77 (1992)).

“‘Furthering this policy goal, Code § 60.2-618(2)(a) 2 prohibits benefits if the 

Commission finds such individual is unemployed because he has been discharged for misconduct 

connected with his work.’” Cmty. Alternatives, 57 Va. App. at 704, 705 S.E.2d at 532-33

(quoting Trent, 55 Va. App. at 568, 687 S.E.2d at 103). 

[A]n employee is guilty of “misconduct connected with his work” 

when he deliberately violates a company rule reasonably designed 

to protect the legitimate business interests of his employer, or 

when his acts or omissions are of such a nature or so recurrent as to 

manifest a willful disregard of those interests and the duties and 

obligations he owes his employer.

 2 Code § 60.2-618 provides: 

An individual shall be disqualified for benefits upon separation 

from the last employing unit for whom he has worked 30 days or 

240 hours or from any subsequent employing unit:

* * * * * * *

2. a. For any week benefits are claimed until he has performed 

services for an employer (i) during 30 days, whether or not such 

days are consecutive, or (ii) for 240 hours, and subsequently 

becomes totally or partially separated from such employment, if 

the Commission finds such individual is unemployed because he 

has been discharged for misconduct connected with his work.

(Emphasis added.)
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Branch v. Virginia Employment Commission, 219 Va. 609, 611, 249 S.E.2d 180, 182 (1978)

(emphasis in original). “‘The Branch definition of misconduct has two prongs.’” Piggly 

Wiggly, 14 Va. App. at 705, 419 S.E.2d at 281 (quoting Israel, 7 Va. App. at 173, 372 S.E.2d at

209). “The first prong defines misconduct as a deliberate violation of a company rule.” Id. at 

705, 419 S.E.2d at 281. “[T]he second prong contemplates actions or omissions of such a nature 

or so recurrent as to manifest a willful disregard of the employer’s interests and the duties and 

obligations the employee owes the employer.” Id. “A forfeiture of benefits will be upheld only 

where the facts clearly demonstrate ‘misconduct,’” id. at 707, 419 S.E.2d at 282, and “[t]he 

employer bears the burden of proving [that] misconduct,” id. at 705, 419 S.E.2d at 280. Once 

that burden is met, the employee is disqualified for benefits “‘[a]bsent circumstances in 

mitigation’” of his conduct. Id. (quoting Branch, 219 Va. at 611-12, 249 S.E.2d at 182). “‘The 

burden of proving mitigating circumstances rests upon the employee.’” Id. at 705, 419 S.E.2d at 

280-81 (quoting Branch, 219 Va. at 611-12, 249 S.E.2d at 182).

Francis does not dispute the validity of Wal-Mart’s decision to terminate her employment 

for committing welfare fraud; rather, the issue in this case is Francis’s ability, upon her 

discharge, to receive unemployment benefits. In other words, Francis does not deny that she 

committed misconduct; she merely alleges her misconduct was not in any way “connected with 

her work.” We disagree with Francis and find that her actions meet the definition of misconduct 

under the second prong of the Branch test. Indeed, the record shows that Francis worked at 

Wal-Mart from June 8, 2006 to April 22, 2008, as a merchandising supervisor in the health and 

beauty department at Wal-Mart, earning $8.35 per hour. Francis’s job duties included making 

price changes on merchandise and stocking shelves. Francis also supervised two associates, and 

on occasion, she was required to operate the cash register. Jennifer Campbell testified that 

Francis’s job “deals with dollars, it deals with paperwork dollars, it deals with physical dollars 
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and merchandise.” Thus, as the VEC found, Francis’s job duties and responsibilities “placed her 

in a fiduciary capacity and a position of trust” with Wal-Mart.

Although Francis did not create any problems at Wal-Mart prior to April 22, 2008 and 

although she had never been disciplined at work, the fact remains that in her employment at 

Wal-Mart she was in a position of trust, and welfare fraud is a crime of moral turpitude. It 

follows that Francis’s actions in committing welfare fraud placed her in a position of distrust 

and, by extension, manifested a willful disregard of Wal-Mart’s interests and the duties and 

obligations Francis owed her employer. The fact that Francis herself found it necessary to report 

the pending charges to Wal-Mart suggests she knew her activities outside of employment had a 

bearing on Wal-Mart’s interests. We, thus, agree with the VEC and the circuit court that 

Wal-Mart carried its burden of proving that Francis’s misconduct was connected with her work,

and Francis has failed to prove any mitigating circumstances justifying receipt of unemployment 

compensation.

In sum, the circuit court did not err in affirming the VEC’s finding that Francis’s 

misconduct was connected with her work, and its decision that she should be denied benefits 

under the Act is, therefore, affirmed.

Affirmed.